Economy may not effect election?

Washington Post:

Home prices are plummeting, food and energy costs are sky high and, for many families, disposable income is stagnant or falling. Economic forecasters say conditions are the worst they've seen in a presidential election year in nearly three decades.

That should spell big trouble for the party in control of the White House, and the Democrats should be waltzing to victory, history suggests. But so far it hasn't turned out that way, even though voters by a wide margin name the economy as the most important issue in the campaign. As the presidential contest enters its final months, public opinion polls show Sen. Barack Obama (D-Ill.) locked in a tight race with Sen. John McCain (R-Ariz.).

Economists who say economic conditions can be used to explain the outcome of almost every presidential election since at least the 1950s are perplexed.

"Historically, the economy seems to matter. And given the state of the economy, it should be giving Obama an edge," said Chris Varvares, president of Macroeconomic Advisers, a St. Louis firm whose forecasting model found that Obama should trounce McCain by nearly 10 points in November.

Indeed, certain economic factors are so negative that, according to Varvares's model, 2008 should be one of the few years the economy "rises to the level of being a deciding factor." But, he said, the polls "certainly show something different."

Although the economy has not fallen into recession, which is generally defined as a significant decline in economic activity lasting more than a few months, there has been plenty of bad news. The nation has been shedding jobs, pushing the unemployment rate to 5.7 percent last month, the highest in four years. Record oil prices drove gasoline prices over $4 per gallon just as people began planning their summer vacations. And, depending on the projections, real disposable income is recording its weakest annual growth in an election year since at least 1980, when President Jimmy Carter lost the White House to Ronald Reagan during a national economic malaise.

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What these guys are overlooking is the impact of Democrat energy policy that is driving down the economy and driving up the cost of energy. Voters recognize that Democrats are the problem and not the solution when it comes to energy. When 75 percent of the voters want to see drilling and the Democrats are blocking it and going on vacation voters would have to be pretty irrational to blame that on Republicans.